May was an exceptional month for the ABC Funds, with all three portfolios meaningfully outperforming their respective benchmarks. This strong performance was driven by our long-standing positioning in artificial intelligence and the companies powering the next generation of technological innovation.
The momentum behind the AI revolution continued to accelerate throughout the month. Corporate earnings across the sector remained exceptionally strong, with many companies reporting results and outlooks that exceeded investor expectations. For example, NVIDIA once again delivered outstanding financial results, highlighting the continued strength of demand for AI infrastructure and advanced computing solutions.
Interestingly, investments directed toward artificial intelligence continue to increase. Alphabet last night announced plans to raise approximately $80 billion to support its expanding AI initiatives and infrastructure, with Berkshire Hathaway contributing $10 billion. We believe this development validates the investment themes we have highlighted for several years and reinforces the growing recognition of artificial intelligence as a transformative force across the global economy.
The strongest contributors to performance during the month included Micron Technology, ARM Holdings, ServiceNow, Apple, ASML, and Microsoft. Of particular note, Micron Technology, the largest holding in the ABC Funds, appreciated approximately 87% during the month. The company has become a major beneficiary from surging demand for high-bandwidth memory that is essential for AI systems and data centers. Another standout performer was ARM Holdings, which gained approximately 68% during the period. ARM is a British technology company whose processor architecture powers billions of devices worldwide, including smartphones, personal computers, data centers, and emerging AI application. We believe ARM is uniquely positioned to benefit from AI. Having been held in all three ABC Funds for a number of years, we are encouraged to see the market finally recognize the company’s strategic importance. More importantly, we believe many of our highest-conviction holdings are beginning to receive greater recognition from investors as the fundamental benefits of AI comes to fruition.
Looking ahead, we remain very optimistic. The U.S. economy continues to demonstrate resilience, corporate earnings remain strong, and investment in artificial intelligence infrastructure continues to accelerate. We believe the AI revolution has the potential to be one of the most significant investment themes in modern history and our ABC Funds remain exceptionally well-positioned to capitalize on this opportunity.
Irwin A. Michael, President
I.A. Michael Investment Counsel Ltd.